by Randal O'Toole
Cato Institute
March 17, 2014
Working Paper Series
The Metro rail transit system now under construction in Panama City, and planned extensions to that system, are poor investments for Panama. Depending on ridership, the US$1.88 billion construction cost of the first 13.7-kilometer line of the system could cost as much as $15 per rider. The costs of operating the line are likely to be greater than fare revenues, and maintenance costs for the system will grow. Rail transit does create winners and losers. The winners include the companies that build the expensive rail lines, owners of property near rail stations, and the few people who will find convenient a train in a low-traffic area. The losers include taxpayers, owners of property away from the rail stations, and anyone who wants to travel to the places the trains don’t go who suffers congestion and poor quality transportation because transit money was spent to benefit an elite few.



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